Washington and Moscow have shared interests, he said on the last day of his trip to Russia's capital.

"America wants a strong, peaceful, and prosperous Russia," he said. However, the president added that "unfortunately" there is "a 19th-century view that we are destined to vie for spheres of influence."

The speech was the culmination of two days of efforts by Obama to "reset" U.S.-Russia ties, long marked by suspicion or hostility.

The result: no unexpected breakthrough. Obama ended up getting an expected agreement on deep cuts in nuclear arsenals, but he is leaving Moscow with few assurances of Kremlin help in solving other issues key to his foreign-policy agenda, including reining in Iran's suspected nuclear-arms ambitions.

He is leaving behind a spark, however, that he hopes will one day blaze to life and thaw U.S. relations with a former superpower with a chip on its shoulder.

Last week, Obama said Prime Minister Vladimir Putin - an ex-KGB officer widely seen as the man in charge of policy despite formally being second in the Kremlin hierarchy to President Dmitry A. Medvedev - has "one foot in the old ways of doing business."

Obama delivered his message to the graduating class of the New Economic School, a group he noted was born after "the darkest hours of the Cold War," a demographic that has had much more exposure to the West than its predecessors.

While he said that it was up to Russia to choose its course, Obama told the audience he agreed with Medvedev about the need for an effective legal system.

Critics of the government often complain about corruption - official and private - and sometimes use it as code to express wider discontent with Kremlin policy.

"The arc of history shows that governments which serve their own people survive and thrive," Obama said. "Governments which serve only their own power do not."

His message resonated with Andrei Voltornist, 29, an alumnus of the economics school, which is overseen by an international advisory board stacked with American academics.

"Our society is still rather closed, but I think it's just a question of time," Voltornist said, standing outside the large trade center where Obama made his address.

Several Russian analysts did not comment because they were not able to watch the speech.

"The main TV channels did not show his speech because they do not focus on news, but those who have Internet or cable TV were able to watch it," said Vladimir Zharikhin, the deputy head of the Institute of CIS Countries, a pro-Kremlin research center.

Zharikhin said he appreciated Obama's stance, even when there were open disagreements. "Instead of saying, 'We won't talk to you until you do this and that,' he says something like, 'We do not wholly agree' or 'We could discuss that,' " he said.

Before delivering his address, Obama had breakfast with Putin in the prime minister's heavily guarded suburban home.

In welcoming Obama, Putin acknowledged U.S.-Russia relations at times have experienced "periods of, shall we say, grayish mood." During the last year, Russia has invaded Georgia - a U.S. ally - and cut gas supplies to Ukraine, also a U.S. ally.

The Obama-Putin meeting, their first, stretched half an hour longer than expected.

Afterward, U.S. briefers, speaking on condition of anonymity, said that while Obama and Putin saw things differently in many areas, there were several topics on which they found common interest: antiterrorism measures, arms control, climate change, and energy security.

'Well-intentioned'

Putin described his conversation with Obama as "very well-intentioned" and "substantial," according to Russian news wires.

In a Fox News interview, Obama said that "on areas where we disagree . . . I don't anticipate a meeting of the minds anytime soon."

Later, Obama met members of the political opposition, who are under pressure in Russia's atmosphere of contracting democratic protections.

A vocal critic of Putin's, former world chess champion Garry Kasparov, said Obama appeared to have held his own with Russia's leaders.

"This government has the mentality of street hoodlums," Kasparov said. "I think that after looking into Obama's eyes Putin understood that this guy won't stand any jokes."

Flash point

While it agreed to join the United States in reassessing the threat from Iran's nuclear ambitions, there was no Kremlin offer of direct intervention with Tehran. The Russians make significant profits from arms sales to Iran and the construction of a nuclear complex for electricity generation.

On the flash-point issue of Georgia, the Kremlin rejected U.S. objections to Russia's insistence that breakaway Abkhazia and South Ossetia remain free of Georgian control. Moscow remained angry over U.S. refusal to back away from support for a Georgia bid to join NATO.

While preparing a START I replacement treaty that would cut nuclear arsenals by about one-third, Moscow was staunchly opposed to U.S. plans for creating a missile-defense system in Eastern Europe.

The two sides did agree to greater cooperation on Afghanistan, where Obama is bolstering the fight against Taliban extremists. Part of the deal will allow the United States to fly, without transit charges, troops and weapons across Russian territory.